Tuesday, August 28, 2012

It was reported that the development will also include a shopping complex and condominium unit.

PERMODALAN Nasional Bhd (PNB) has obtained the development order from City Hall to build the 100-storey Menara Warisan Merdeka.

The development order was attached with several conditions, including those related to legal matters, said PNB president and chief executive officer Tan Sri Hamad Kama Piah Che Othman.

"We are studying the terms in order to fulfil them. We must ensure proper planning because the development order is approved with conditions," he said after announcing the income distribution for Amanah Saham Wawasan 2020 for the year ended August 31 2012, here, yesterday.

Earlier reports said PNB would be undertaking the RM5 billion Warisan Merdeka development in three phases over 10 years, starting with the 100-storey tower this year.

The tower - touted to be the country's tallest - will cost RM2.5 billion to RM3 billion and will have gross floor space of three million sq ft and net floor space of 2.2 million sq ft. It is scheduled to be completed in 2015.

To another question, Hamad said PNB would announce the disposal of its fifth non-core company to qualified Bumiputera companies by October.

"Four companies have already been divested so far. We hope everything will be settled by the first half of next year," he added.

The announcement of the finalised purchase price for the Rubber Research Institute land prompts a rebound in Malaysian Resources Corp Bhd share prices.

The Employees Provident Fund's wholly-owned Kwasa Land Sdn Bhd yesterday announced that it has finalised the purchase price of RM2.28 billion for the Rubber Research Institute (RRI) land from the government, prompting a rebound in Malaysian Resources Corp Bhd (MRCB) share prices.

MRCB, which was speculated to play a major role in the development of the land, saw its shares rise to a high of RM1.70, before closing up six sen to RM1.67.

The 932ha site in Sungai Buloh, Selangor, will be developed into a township called Kwasa Damansara with an expected population of 150,000.

The land will be divided into parcels, developed in phases, and sold to developers according to plot ratios, development components and in conformance with the urban design guidelines by Kwasa Land.

"We will soon be calling for the pre-qualification of developers to participate in the creation and building of an iconic township that will be the toast of the town in the coming years," Kwasa Land chairman Tan Sri Samsudin Osman said.

The company is looking for experienced property developers with strong track record and successfully completed developments with a high gross development value (GDV) for the past two to three years.

"The development will incorporate plans that are befitting of a city replete with infrastructure and modern facilities, both residential and commercial that aim to serve the entire Damansara region, if not the Klang Valley," Samsudin said in a statement yesterday.

The development planning is now in an advanced stage with the iconic township development expected to commence in 2013, he added.

Among the key features in the design and layout plan is a development hub comprising modern residential, commercial, recreational and educational facilities.

It will also incorporate an integrated transportation system that links the township via MRT (mass rapid transit) to the rest of Klang Valley.

A 7.5km green park of 64ha will also be among the highlights of the development.

The master plan is being finalised for submission to the Selangor State planning committee for approval.

PETALING JAYA: Employees Provident Fund's (EPF) wholly-owned subsidiary Kwasa Land Sdn Bhd is acquiring the 2,330 acres of Rubber Research Institute (RRI) land in Sungai Buloh from the Malaysian Rubber Board for RM2.28bil or RM22.50 per sq ft, thus confirming reports that the land will cost more than RM2bil.

The land, to be known as Kwasa Damansara, would have a development period spanning 10 to 15 years and would be transformed into a township with a mix of residential and commercial properties, infrastructure and public amenities for an expected population of 150,000.

Kwasa Land's chairman Tan Sri Samsudin Osman said in a statement that the township would “incorporate plans that are befitting of a city replete with infrastructure and modern facilities both residential and commercial that aim to serve the entire Damansara region, if not the Klang Valley.”

Kwasa Land, tasked as the master developer, would be calling for a process to pre-qualify developers for projects in the township. Earlier reports quoting sources had said that this would likely involve tendering out parcels of between 100 acres and 500 acres.

“We will soon be calling for the pre-qualification of developers to participate in the creation and building of an iconic township that will be the toast of the town in the coming years,” Samsudin said.

He said the master plan was now in an advanced stage and was being finalised for submission to the Selangor State Planning Committee for approval as development is expected to commence next year.

Sources have also said the pre-qualification process would start soon but this, according to observers, would take time as EPF and Kwasa Land must still come up with a master plan acceptable to the local authority, which hopefully would include provisions to accommodate changes in the future.

Samsudin said Kwasa Land would be responsible for obtaining all the necessary approvals for the master layout plan and for the construction of the main infrastructure.

“The land will be divided into parcels, developed in phases, and sold to developers according to plot ratios, development components and in conformance with the urban design guidelines by Kwasa Land,” he said, adding that developers who have successfully completed projects with a high gross development value in the past two to three years could participate in the pre-qualification process.

“The design concept plan is to be evaluated first prior to the tender price,” Samsudin said.

He said the master plan would incorporate an integrated transportation system that links the township via the My Rapid Transit to the Klang Valley. “A 7.5km green park of 160 acres will also be among the highlights of this new development,” Samsudin said.

He said that the proposed development components must be aligned to the urban design guidelines determined by Kwasa Land “in which harmony is an important pre requisite to the entire development.”

Meanwhile, VPC Alliance (KL) Sdn Bhd managing director James Wong said in an email reply to StarBiz that the price “does not seem unreasonable given the limited prime land in the Klang Valley for township development.”

Dijaya Corp Bhd had to pay RM26 per sq ft for a 198-acre track in Kajang and Mah Sing Group Bhd paid RM18 per sq ft for a 172-acre site in Bandar Baru Bangi.

Wong said the price was reflective of the market value of the land since Kwasa Land was responsible for the necessary approvals and construction of the main infrastructure.

“In addition, part of the RRI land is within Petaling Jaya and the Petaling Jaya address always commands a premium,” he said.

Another property valuer said besides giving an indication on the tender price, the sale price would indicate the type of projects that the township may incorporate.

“Hopefully Kwasa Land will plan something sensible, we need more green spaces. What I'm worried about is that there'll be too many highrise projects contributing to higher density,” he said.

Mega REIT: IGB REIT Management Sdn Bhd MD Robert Tan with chief financial officer Chai Lai Sim at growth of 15% to 20% this year. the launch of the IGB REIT prospectus. The listing of the largest retail REIT is slated for Sept 21. - THE STAR/FAIHAN GHANI

KUALA LUMPUR: IGB Real Estate Investment Trust (IGB REIT) may consider inorganic expansion opportunities such as acquisitions in the United States or Europe in view of the dire financial situation there.

“In Europe or the United States you can get some properties at way below replacement costs. That is an area we can pursue for potential acquisitions.

“But what we prefer is to construct the mall ourselves and manage it before injecting it into the REIT,” IGB REIT Management Sdn Bhd managing director Robert Tan said at the launch of the IGB REIT prospectus here yesterday.

IGB REIT Management is the company that will manage IGB REIT.

IGB REIT is a unit of IGB Corp Bhd and Tan is also group managing director of IGB Corp.

Based on the retail price of RM1.25 per unit, IGB REIT will provide a distribution yield of 5.1% on an annualised basis for the six-month forecast period ending Dec 31.

“We have to ensure that The Gardens and the Mid Valley Megamall are well-managed. Hopefully these investments will continue to see year-on-year growth and thereafter we will look at acquisitions,” Tan said.

A total of 670 million units of IGB REIT will be offered. Upon listing, IGB REIT will become the largest retail REIT in Malaysia with an asset value of RM4.6bil.

The listing will see the REIT being offered to institutional shareholders (13.8%), eligible IGB shareholders (3.5%), eligible directors and employees (1.4%) while the Malaysian public will have the smallest share allocation of 1%.

The opening date for the institutional offering will be on Aug 28 and the closing date on Sept 6.

Balloting for the retail portion will be conducted on Sept 7 and IGB REIT will be listed on Sept 21.

The Mid Valley Megamall has an appraised value of RM3.44bil with net lettable area of 1.72 million sq ft and an occupancy rate of 99.8%, It has 6,092 car park bays.

The Gardens has an appraised value of RM1.16bil with net lettable area of 817,053 sq ft and an occupancy rate of 99.7%. It has 4,128 car park bays.

IGB Real Estate Investment Trust (REIT), a unit of property developer IGB Corporation Bhd and en route to a listing on Bursa Malaysia's Main Market, will focus actively on growing its two retail assets as its main strategy in the next few years besides considering potential acquisitions overseas.

IGB Corp's 75 per cent subsidiary KrisAssets Holdings Bhd, which owns the two retail assets under the IGB REIT -- Mid Valley Megamall and The Gardens Mall -- has formed IGB REIT Management Sdn Bhd to manage and set the strategic direction of the trust.

"Both the assets have a long way to go as it takes time for the properties to mature.

"After listing, we have to make sure these properties are well managed and investors see a year-to-year growth of about 5-8 per cent of our revenue given the increasing competition," IGB REIT Management Sdn Bhd Managing Director Robert C M Tan told reporters at the trust's prospectus launch.

However, if any potential opportunities arise for acquisition locally or overseas, the manager would look into it under the REIT, he said.

"At the moment, the Europe and United States markets have good deals and we can look at some properties there for acquisition, preferably completed or mostly conpleted properties," he said adding that it would prefer to construct and manage the properties.

He also said the recent acquisition of Southkey Megamall Sdn Bhd would take about three to five years from now to develop.

IGB REIT is set to be Malaysia's largest retail REIT by asset value with the listing slated on Sept 21.

The trust, which offers 670 million units at an initial retail price of RM1.25 per unit, is expected to raise RM837.5 million from the initial public offering with a forecast 5.1 per cent yield annualised.

"The offer price is a fair deal looking at other REITs' performance, and we are very conservative when it comes to pricing," Tan said.

He said the listing would provide an avenue for investors to invest in one of the largest REITs in Malaysia with a total net lettable area of approximately 2.5 million sq ft (232,258 sq m).

Upon listing, IGB REIT is expected to achieve a market capitalisation of RM4.25 billion.

IGB Corp is optimistic of its retail property market given the continuous earnings growth against the backdrop of uncertainties in the global economy and competition, he added.

SUBANG JAYA: IJM Land Bhd looks forward to another year of growth due to the strong demand for properties in the country.

Group chief executive officer and managing director Datuk Soam Heng Choon said that for the current financial year ending March 31, 2013 (FY13), the group aimed to “do better than FY12 sales performance of RM1.35bil.”

The group is aiming to launch about RM2bil worth of properties in FY13. “We have unbilled sales of RM1.2bil. Based on this, we should churn out quite a strong performance this year,” Soam said after the group's AGM.

He said IJM Land had seen strong sales in its projects in the last few months.

“For example, our Seri Riana Residences condominium in Wangsa Maju we have launched two blocks. For Block A, we have close to 90% take-up rate and for Block B, we have 65%. Two weeks ago, we launched more than 190 units of shop offices in Seremban 2. All the non-bumiputra units were taken up on the same day.”

Soam said the group remained optimistic about the Malaysian property market “given the right product and location”.

“In Wangsa Maju, we are selling at RM500 to RM550 per sq ft with absolute values of RM600,000 to RM700,000. There is still very strong demand.”

The group has an undeveloped land bank of 4,800 acres with a gross development value of RM23bil.

Soam said the group's major upcoming property launches included Bandar Rimbayu in Selangor and new phases of The Light waterfront project in Penang.

“We are planning for RM350mil of launches in Bandar Rimbayu, where we have 6,000 registrants for phase one consisting of more than 500 houses.”

He said in Penang, the group planned to launch two residential parcels The Light Collection Three and Four.

“There will also be RM120mil of launches in the Southern Region and RM200mil in Sarawak and Sabah.”

IJM Land Bhd has secured the necessary funding for the RM1.4 billion joint-venture property development project in London and expects to start selling the properties within the next 12-15 months.

"We are now in the initial stage of the project and getting the necessary structure in place. In terms of sales, we expect to begin within the next 12-15 months," IJM Land chief executive officer and managing director Datuk Soam Heng Choon said after the company's annual general meeting yesterday.

The company will fund the project via internally generated funds and bank borrowings.

The project, which has a gross development value of STG280 million (RM1.37 billion), comprises a five-star hotel and residential units.

Early this month, IJM Land had entered into a shareholders' agreement with Lite Bell Consolidated Sdn Bhd to form a joint-venture company in Jersey - Mintle Ltd - to acquire a 999-year lease over a 1.09ha site.

The project is part of the company's plan to seek new earnings growth avenues abroad, given its already high earnings base in Malaysia.

For the financial year ending March 31 2013, the company plans to launch some RM2 billion worth of property projects, of which more than RM1.2 billion worth of projects have yet been launched.

These projects are located in Seremban, Shah Alam, Penang, Johor and also East Malaysia.

It also has some 1,944ha of land bank, with the potential gross development value of RM23 billion.

The company, which registered a revenue of RM1.2 billion for the year ended March 31 2012, hopes to grow its revenue this year, helped by continuous strong demand for its properties.

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